Jul 22 - Dolly was upgraded to a hurricane from a tropical storm but oil prices still fell due to small risk of disruption to Gulf operations.The Dow surged 135 points to 11,602. The S&P 500 gained 17 points to 1,277. The Nasdaq rallied 24 points to 2,303. Crude oil lost more than $3 to settle at $127.95 a barrel. Conway Gittens reports from New York. Author: ReutersVideo Keywords: Ol prices Hurricane Dolly business_GF Added: July 22, 2008